Bank Life Sales Continue to Surge for 5th Quarter

Windsor, CT September 15th, 2010  --  The second quarter of 2010 marked the fifth consecutive quarter of significant gains for life insurance sales through banks according to the quarterly Kehrer-LIMRA Bank Life Report. The sudden increase began in the second quarter of 2009, a time when customers, platform reps, and advisors were weary of variable products, and when the spread between fixed annuities and certificates-of deposit narrowed, making fixed annuities less desirable.

“With over $200 billion in sales last year, annuities are still far more prevalent in the bank world; however, life products are finally garnering the attention they deserve” said Scott Stathis, Managing Director of Kehrer-LIMRA.

In 2009 life insurance premium was just 3 percent shy of the peak of $1.29 billion in 2004. “If sales remain steady, 2010 will be a record breaking year for the sale of life insurance through banks” added Stathis.

There were 29 percent more life insurance policies purchased through banks during the first six months of 2010 than there were during the same period of 2009. In fact, in the first half of 2010, banks experienced a larger percent growth in both premium and policy sales than any other channel that life insurance is distributed through. Once again, the increase in bank sales reflected steep growth in single premium sales which represent the vast majority of new premium payments.

The quarterly Kehrer-LIMRA Bank Life Report also stack ranks the insurance companies with the most distribution through the bank channel. All but one of the top participating writers experienced significant growth through the second quarter. In addition to market dynamics, increases in wholesaler support along with product and application simplification have also been pivotal stimuli for the steady increases in sales. These have become very important factors in the bank world, particularly with platform reps that are not accustomed to selling life insurance. The combination of these factors has helped make bank-based reps more receptive to selling life insurance.

As reps become more accustomed to selling life insurance and discussing wealth transfer, the focus on and management of life insurance specific sales goals should help keep the momentum. According to a separate Annual Kehrer-LIMRA Bank Life Sales Study, banks with established life insurance goals generate 5.5 times more new life revenue penetration than those without goals.

Kehrer-LIMRA is a provider of best-practices research, benchmarking, study groups and consulting to the bank brokerage industry. Additional information can be found at www.kehrerlimra.com

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